EX-10.5






EXHIBIT 10.5




SECOND AMENDMENT OF

THE GUIDANT RETIREMENT PLAN




This Second Amendment of The Guidant Retirement Plan (the “Plan”) is adopted by Guidant
Corporation (“Company”).



Background




A. The Company established the Plan on September 25, 1995, and most recently restated it in
its entirety effective January 1, 2007.



B. The Plan was frozen effective May 31, 2007.



C. The Plan has been amended by a First Amendment.



D. The Company now wishes to amend the Plan further.



Amendment




Therefore, effective as of the dates specified, the Plan is amended as follows:



1. Effective January 1, 2008, Section 2.01(a)(15) is amended to read as follows:




	 	(15)	 	Eligible Retirement Plan. The term “Eligible Retirement Plan”
means any of the following that accepts a Distributee’s Eligible Rollover
Distribution: subject to the applicable requirements of Code section 408A, a
Roth IRA described in Code section 408A; an individual retirement account
described in Code section 408(a); an individual retirement annuity described in
Code section 408(b); an annuity plan described in Code section 403(a); a
qualified trust described in Code section 401(a); an annuity contract described
in Code section 403(b) and an eligible plan under Code section 457(b) that is
maintained by a state, political subdivision of a state, or any agency or
instrumentality of a state or political subdivision of a state and that agrees
to separately account for amounts transferred into that plan from this Plan.	 





2. Effective January 1, 2007, Section 2.01(a)(16) is amended to read as follows:




	 	(16)	 	Eligible Rollover Distribution. The term “Eligible Rollover
Distribution” means any distribution of all or any portion of the balance to
the credit of the Distributee, except that an Eligible Rollover Distribution
does not include: (1) any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the Distributee or the joint lives (or
joint life expectancies) of the Distributee and the Distributee’s Beneficiary,
or for a specified period of 10 years or more, (2) any distribution to the
extent the distribution is required under Code section 401(a)(9), (3) the
portion of any distribution that is not includable in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to
employer securities) and (4) any hardship distribution. Notwithstanding the
preceding provisions of this paragraph, a distribution will not fail to be an
Eligible Rollover Distribution merely because it consists of after-tax employee
contributions that are not includable in gross income. However, such portion
may be paid only to an individual retirement account or annuity described in
Code section 408(a) or (b), or to a qualified defined contribution or defined
benefit plan described in Code section 401(a) or 403(a) or an annuity contract
described in Code section 403(b) that agrees to separately account for amounts
so transferred, including separately accounting for the portion of the
distribution that is includable in gross income and the portion of the
distribution that is not so includable.	 





3. Effective January 1, 2008, a new Section 5.01(e) is added to read as follows:




	 	(e)	 	Form V. With respect to a Retired Employee or Deferred Benefit
Employee who has a Spouse on his Annuity Starting Date, a joint and spouse
annuity providing monthly payments for the Retired Employee’s or Deferred
Benefit Employee’s life with monthly payments continuing thereafter for the
remaining life of his Spouse under which each monthly payment is equal to
seventy-five percent (75%) of the amount of the monthly payment during their
joint lives. Form V is the Actuarial Equivalent of Form II.	 





4. Effective January 1, 2010, Section 5.05 is amended to read as follows:




	 	5.05.	 	Information Relevant to Optional Forms of Benefit. Not less
than 30 days and not more than 180 days before the Annuity Starting Date, the
Employee Benefits Committee will furnish, by mail or by personal delivery, to
each Employee, Deferred Benefit Employee, or Retired Employee who is eligible
to elect an optional form of benefit, a general written explanation, in
non-technical language, of the terms and conditions of the applicable normal
form of benefit, his right to make (and the effect of) an election to receive
benefits in an optional form, the consequences of selecting a benefit form that
does not defer the receipt of benefits, the requirements regarding spousal
consent to an election to receive benefits in an optional form, the right to
make (and the effect of) a revocation of an election to receive benefits in an
optional form, the financial effect upon an Employee’s benefits of the various
forms of payment, and the relative value of each optional form compared to the
value of the applicable normal form of benefit.	 





5. Effective January 1, 2008, Section 5.07 is amended to read as follows:




	 	5.07.	 	Social Security Adjustment. With respect to Former Lilly
Employees, in order to provide a level retirement income, an Employee who
retires before age sixty two (62) (but not a Deferred Benefit Employee) may
elect that the monthly payments made to him prior to his attainment of age
sixty two (62) under Form I, II, III, IV or V described in subsection 5.01 will
be increased by an amount elected by the Retired Employee, but not in excess of
five hundred dollars ($500) expressed in ten dollar ($10) increments.
Beginning with the month following the month in which the Retired Employee
attains age sixty two (62), the monthly payments made to the Retired Employee
will be decreased to reflect the increased payments made to the Retired
Employee prior to that time. The decrease in payments will be calculated based
upon the “applicable mortality table” described in Code section 417(e)(3)(B)
and the “applicable interest rate” described in Code section 417(e)(3)(C) for
the second full calendar month preceding January 1 of the Plan Year stability
period that contains the annuity starting date for the increased payments.	 





6. Effective January 1, 2010, Section 5.10 is amended to read as follows:




	 	5.10.	 	Optional Direct Rollover.	 






	 	(a)	 	With respect to any distribution, a Distributee may
elect to have any portion of the payment that is an Eligible Rollover
Distribution paid to an Eligible Retirement Plan; provided, that a
Distributee may not elect a direct rollover if the total amount of all
payments or withdrawals in a Plan Year is less than $200.00. The
election will be made in the form and at the time prescribed by the
Employee Benefits Committee, will specify the Eligible Retirement Plan
to which the distribution or withdrawal amount is to be paid, and will
be subject to any rules as the Employee Benefits Committee from time to
time may establish.	 






	 	(b)	 	A non-Spouse Beneficiary who is a designated
beneficiary (as defined in Code section 401(a)(9)(E)) of a Participant
may elect to have any portion of a distribution payable to him or, to
the extent provided in rules prescribed by the Secretary, payable to a
trust maintained for his benefit, transferred in a direct
trustee-to-trustee transfer to an individual retirement plan described
in Code section 402(c)(8)(B)(i) or (ii) established for the purpose of
receiving the distribution on behalf of the Beneficiary.	 





7. Effective January 1, 2010, the first paragraph of Section 6.04 is amended to read as
follows:



With respect to Former CPI Employees and Former ACS Employees, the Employee
Benefits Committee will furnish to an Employee or Deferred Benefit Employee,
by mail or personal delivery, a general written explanation in non technical
terms of the terms and conditions of the pre retirement Spouse’s benefit,
the individual’s right to make (and the effect of) an election to waive the
pre retirement Spouse’s benefit coverage, the consequences of selecting a
benefit form that does not defer the receipt of benefits, the requirements
regarding spousal consent to an election to waive that coverage and the
right to make (and the effect of) a revocation of a waiver (a “QPSA
Explanation”) in the following circumstances and at the following times:



8. Effective January 1, 2009, Section 8.02(e) is amended by adding the following sentence at
the end to read as follows:



Effective January 1, 2009, the applicable mortality table used for purposes
of adjusting any benefit or limitation under Code section 415(b)(2)(B), (C)
or (D) as set forth in this subsection 8.02 is the applicable mortality
table (within the meaning of Code section 417(e)(3)(B)).



9. Effective January 1, 2009, Section 8.06 is amended to read as follows:




	 	8.06.	 	Compensation. For purposes of this Section 8, the term
“compensation” means the Employee’s wages within the meaning of Code
section 3401 (without regard to any rule under Code section 3401(a) that limits
amounts included in wages based on the nature or location of the employment)
and all other payments for which the Employer is required to furnish the
Employee with a written statement under Code sections 6041(d), 6051(a)(3)
and 6052. “Compensation” also includes amounts that would have been paid to
the Employee during the Plan Year in the absence of a salary redirection
agreement but are excluded from gross income pursuant to Code section 125,
132(f), 457, or 402(g). “Compensation” excludes severance pay and any other
amounts paid after severance from employment, other than regular compensation
for services during or outside regular working hours that is paid within
21/2 months of severance from employment or, if later, by the last day of the
Plan Year in which employment was severed, and other than “differential wage
payments” described in Code section 3401(h)(2); and salary continuation
payments to Employees who do not perform services for the Employer by reason of
disability. “Compensation” for a Plan Year does not include amounts earned but
not paid during the Plan Year because of the timing of pay periods and pay
dates or administrative delay. Notwithstanding the preceding provisions,
“compensation” for a calendar year that is considered for purposes of applying
the compensation limitation prescribed under subsection 8.01(b) may not exceed
$230,000. The $230,000 limitation referred to in the preceding sentence will
be adjusted to reflect increases in the limitation pursuant to Code
section 401(a)(17).	 





10. Effective January 1, 2008, a new Section 9.02 is added to read as follows:




	 	9.02.	 	Restrictions Based on Funding Status. Notwithstanding any
provision of the Plan to the contrary, the following provisions will apply as
required by Code section 436, except to the extent the exception under Code
section 436(d)(4) applies:	 






	 	(a)	 	If the Plan’s adjusted funding target attainment
percentage for a Plan Year is less than 60 percent, benefit accruals
will cease during the period benefit accruals are restricted under the
provisions of Code section 436(e). The benefit accruals that were not
permitted to accrue will be restored automatically as of the
436 measurement date the limitations under Code section 436(e) cease to
apply, if (i) the continuous period of the limitation is 12 months or
less, and (ii) the Plan’s enrolled actuary certifies that the adjusted
funding target attainment percentage for the Plan would not be less
than 60 percent taking into account the restored benefit accruals for
the prior Plan Year.	 






	 	(b)	 	If the Plan’s adjusted funding target attainment
percentage for a Plan Year falls below the threshold under Code
section 436(d)(1) or (3), the Trustee will, as directed by the
Employer, cease payment of any prohibited payment during the period
specified in, and to the extent necessary to comply with, Code
section 436(d).	 






	 	(c)	 	In no event will a prohibited payment be paid during
any period the Employer is a debtor in a case under Title 11 of the
United States Code, or similar federal or state law, to the extent
necessary to comply with the provisions of Code section 436(d)(2).	 






	 	(d)	 	In no event will an amendment that has the effect of
increasing liabilities of the Plan by reason of increases in benefits,
establishment of new benefits, changing the rate of benefit accrual, or
changing the rate at which benefits become nonforfeitable become
effective during the period the amendment would violate the provisions
of Code section 436(c).	 






	 	(e)	 	If an optional form of benefit that is otherwise
available under the terms of the Plan is not available because of the
application of Code section 436(d)(1) or (2), the Retired Employee,
Deferred Benefit Employee or beneficiary, as applicable, will be
eligible to elect another form of benefit available under the Plan or
to defer payment to a later date (to the extent permitted under
applicable qualification requirements).	 






	 	(f)	 	If an optional form of benefit that is otherwise
available under the terms of the Plan is not available because of the
application of Code section 436(d)(3), a Retired Employee, Deferred
Benefit Employee or beneficiary, as applicable, will be eligible to
defer his entire payment to a later date (to the extent permitted under
applicable qualification requirements) or to bifurcate the benefit into
unrestricted and restricted portions. If an Employee or beneficiary
elects to bifurcate the benefit, the Employee or beneficiary will be
eligible to elect, with respect to the unrestricted portion of the
benefit, any optional form otherwise available under the Plan with
respect to the Employee’s or beneficiary’s entire benefit and in this
case, if the Employee or beneficiary elects payment of the unrestricted
portion of the benefit in the form of a prohibited payment, the
Employee or beneficiary will be eligible to elect:	 






	 	(1)	 	to receive payment of the restricted
portion of the benefit in any optional form of benefit under
the Plan that is not a prohibited payment and that would have
been permitted with respect to the Employee’s or beneficiary’s
entire benefit; or	 






	 	(2)	 	to defer commencement of the restricted
portion of the benefit until after the restrictions on
prohibited payments lapse (to the extent permitted under
applicable qualification requirements) and receive that amount
in any optional form of payment available under the Plan.	 





The election will be subject to any other applicable qualification
requirements, will be treated as a new annuity starting date, and
will be made in accordance with all Plan rules regarding elections
of forms of benefit.




	 	(g)	 	If an Employee or beneficiary is entitled to an
unpredictable contingent event benefit with respect to any event
occurring during any Plan Year, the unpredictable contingent event
benefit will not be provided to the Employee or beneficiary if the
Plan’s adjusted funding target attainment percentage for the Plan Year
is less than 60 percent or would be less than 60 percent taking into
account the occurrence; provided, however, that the unpredictable
contingent event will become payable if and when the Plan meets the
exemption under Code section 436(b)(2).	 





For purposes of this Section, the terms “adjusted funding target attainment
percentage,” “prohibited payment,” “unpredictable contingent event benefit,”
“unrestricted portion of the benefit,” and “restricted portion of the
benefit” will have the meanings given under Code section 436 and any
applicable Internal Revenue Service guidance.



If the provisions of this Section 9.02 or any part thereof cease to be
required by law as a result of subsequent legislation or otherwise, this
Section or any applicable part thereof will be ineffective without the
necessity of further amendments to the Plan.



Guidant Corporation has caused this Second Amendment of The Guidant Retirement Plan to be
executed by its duly authorized officer on this        day of      , 2009.




GUIDANT CORPORATION




By:




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